It’s an accepted internet observation that most people skim read the text on web pages, and if you were to stop at the first conclusion and the headline of this recent article by Countrywide, you’d completely miss the point.
“Rental Growth Stalls
Rents in Great Britain were £5 a month (0.6%) lower than in February 2016, the first annual fall for more than six years.”
Of course, there’s more to the article than this fact – Countrywide measure supply and demand of single family homes, and their diagnosis was based on the whole of the country. They are country-wide after all. If you take a deeper dive into the statistics, you’ll see that rents have dropped in London and supply is up there.
However, and this is a big but: Fossey Taylor invest predominantly in the East Midlands and we see a different picture here (the worst investment property Jesse bought last year is yielding 25.0% as a single let after refinance)
The rental increase year on year from February 2016 to February 2017 in the Midlands is +2.8% – bucking the national trend.
If you look at supply and demand in the East Midlands, you see that rental supply is up 5% since last year, but demand is up 9%. Demand for single let properties is outstripping supply here, which contributes to our extremely low voids.
You can read the whole Countrywide article here, and for reference, here’s their table highlighting that the East Midlands is in fact on the up and up for rentals.
If you would like to learn more about how to challenge the conventional wisdom that 7-8% yields from single let property investments are acceptable, then come along and meet us. We might also tell you the secrets of getting even higher yields from HMO investments.